Human Geography By James Rube by aT3XuPP

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									        Human Geography
             By James Rubenstein
                     Chapter 9
                    Key Issue 4
Why Do Less Developed Countries
 Face Obstacles to Development?
November 17, 2011       S. Mathews   1
In recent years, LDCs have made
   improvements in development,
  but the gap between LDCs and
  MDCs have continued to widen.
  Natural Increase has dropped
 20% in LDCs compared to 83% in
              MDCs.
  1/5th of the world’s people (in
    MDCs) consume 5/6ths of the
           world’s goods.
November 17, 2011   S. Mathews   2
  Progress
   toward
development




 November 17, 2011   S. Mathews   3
 To reduce disparities between
   the rich and poor countries,
      LDCs must develop more
      rapidly. They must . . .
 adopt policies that successfully
  promote development (emphasis
     is on international trade).
They must find funds to pay for
 the development (emphasis is on
          self-sufficiency).
November 17, 2011   S. Mathews   4
       Elements of Self-
      Sufficiency Approach
1. Spread investment as equally as
 possible across all sectors of the
 economy and regions.
2. Isolate fledgling businesses
 from international corporations.
3. Set barriers to limit imports.
 November 17, 2011   S. Mathews   5
  India: Example of the
Self-Sufficiency Approach
1. Limited imports of foreign
   goods
2. Exports were discouraged.
3. Government approval required
   for expansion.
4. Businesses subsidized.
 November 17, 2011   S. Mathews   6
 Problems with the Self-
 Sufficiency Alternative
1. Inefficiency - protects
   inefficient businesses.
2. Large Bureaucracy – the
   complex administration, needed
   to manage controls, encouraged
   abuse and corruption.
 November 17, 2011   S. Mathews   7
Elements of International
    Trade Approach
1. What resources does a country
 have in abundance that other
 countries are willing to buy?
2. What products can the country
 manufacture and distribute at a
 higher quality and lower cost to
 other countries?
 November 17, 2011   S. Mathews   8
          *Rostow’s 5 stage
          Development Model
1.     The           traditional society.
2.     The           preconditions for takeoff.
3.     The           takeoff.
4.     The           drive to maturity.
5.     The           age of mass consumption.
 November 17, 2011          S. Mathews       9
The Traditional Society
     A very high percentage of
        population engaged in
             agriculture.
   A high percentage of national
         wealth allocated to
   “nonproductive” activities, such
     as the military and religion.
November 17, 2011   S. Mathews    10
    The Preconditions for
          Takeoff
Under influence of well educated
 leaders, the country starts to
   invest in new technology and
  infrastructure, such as water
    supplies and transportation
              systems.
November 17, 2011   S. Mathews   11
                    The Takeoff
Rapid growth, technical advances,
 and high productivity occur in a
    limited number of economic
             activities.
 Other sectors of the economy
 remain dominated by traditional
             practices.
November 17, 2011       S. Mathews   12
The Drive to Maturity
Modern technology diffuses from
  take-off industries to a wide
      variety of industries.
Workers become more skilled and
           specialized.


November 17, 2011   S. Mathews   13
            The Age of Mass
              Consumption

       The economy shifts from
      production of heavy industry
          to consumer goods.


November 17, 2011   S. Mathews       14
   MDCs are in stages 4 and 5.
  As a country concentrates on
  international trade, it benefits
  from exposure to consumers in
          other countries.
Rostow’s model suggests that any
     country can become more
             developed.
November 17, 2011   S. Mathews   15
Examples of International
    Trade Approach
Persian Gulf States used petroleum
 revenues to finance large projects
   and provide consumers goods.
 South Korea, Singapore, Taiwan,
  and Hong Kong used cheap labor
    to produce and sell products
            inexpensively.
 November 17, 2011   S. Mathews   16
         Problems with the
        International Trade
                 .
            Alternative




November 17, 2011   S. Mathews   17
         Problems with the
        International Trade
            Alternative
1. Uneven Resource
   Distribution
2. Market Stagnation
3. Increased Dependence on
   MDCs
November 17, 2011   S. Mathews   18
             Uneven Resource
               Distribution
  LDCs suffer when the resource
   that they have for sale doesn’t
    command a large enough price
      to enable them to purchase
     products needed for growth.

November 17, 2011   S. Mathews   19
      Market Stagnation

      The slow growth of MDCs
     population can and has limited
     market size of products from
                 LDCs.


November 17, 2011   S. Mathews    20
Increased Dependence on
         MDCs
        Investments in takeoff
         industries may reduce
      production of necessities for
     the population, forcing an LDC
     to depend on MDCs for those
               necessities.
November 17, 2011   S. Mathews    21
  Recent Triumph of the
   International Trade
        Approach
      Since India dismantled its
   barriers to international trade,
   its per capita GDP has increase
       from 4% to 6% annually.

November 17, 2011   S. Mathews   22
World Trade Organization
      Established in 1995, by
    countries representing 97% of
             world trade,
      to promote, and remove
    barriers to international trade
           in all countries.

November 17, 2011   S. Mathews    23
   Critics of the WTO
 Liberals charge the WTO as
        antidemocratic.
  Conservatives charge that
   the WTO compromises the
    sovereignty of individual
           countries.

November 17, 2011   S. Mathews   24
Financing Development
LDCs must generally obtain loans
           from MDCs.
  From banks and international
        organizations, and
   From direct investment by
    transnational corporations.
November 17, 2011   S. Mathews   25
                     Loans
     The World Bank and the
 International Monetary Fund lend
 about $50 billion annually to LDCs
         for development.
Commercial banks from MDCs have
   a current outstanding loans to
    LDCs totaling $2.1 trillion.
 November 17, 2011    S. Mathews   26
    Problems with Loans
   Half of the projects funded in
  Africa have ended up as failures.
 Many LDCs have accumulated debt
    that exceeds annual income.
Lending agencies have had to cancel
    debt and encouraged LDCs to
     adopt structural adjustment
              programs.
 November 17, 2011   S. Mathews   27
 Debt as a percentage of income




November 17, 2011   S. Mathews   28
Structural Adjustment Programs
   Policies that create conditions
   encouraging international trade,
    such as raising taxes, reducing
   government spending, controlling
    inflation, selling publicly owned
   utilities to private corporations,
    and charging citizens more for
                services.
 November 17, 2011   S. Mathews    29
Transnational Corporations
         Corporations operating in
        countries other than the one
       in which its headquarters are
                   located.



 November 17, 2011   S. Mathews    30
Flow of Investment
November 17, 2011   S. Mathews   31
                                     Core and
                                     Periphery
                                        Most
                                       MDCs
                Core and                are
                Periphery             located
                  Most                 above
                  MDCs                the 30o
                                       north
                                     latitude.
November 17, 2011       S. Mathews         32
                    Finis


November 17, 2011   S. Mathews   33

								
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